Federal Register / Vol. 80, No. 44 / Friday, March 6, 2015 / Notices 12213 

1According to Commission records, one issuer 

filed two notifications on Form 1–E, together with 

offering circulars, during 2013 and 2014. 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 73682 

(November 25, 2014), 79 FR 71481 (December 2, 

2014) (File No. SR–FICC–2014–09). 

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

5 In 2010, the Commission approved a proposed 

rule change filed by FICC to add Rule 22B to the 

GSD rules (‘‘GSD Default Rule’’). See Securities 

Exchange Act Release No. 63038 (October 5, 2010), 

75 FR 62899 (October 13, 2010) (File No. SR–FICC– 

2010–04). In 2012, the Commission approved a 

proposed rule change filed by FICC to add Rule 17A 

to the MBSD rules (‘‘MBSD Default Rule’’, and 

together with the GSD Default Rule, ‘‘FICC Default 

Rules’’). See Securities Exchange Act Release No. 

66550 (March 9, 2012), 77 FR 15155 (March 14, 

2012) (File No. SR–FICC–2008–01). 

6See Securities Exchange Act Release No. 63038 

(October 5, 2010), 75 FR 62899 (October 13, 2010) 

(File No. SR–FICC–2010–04) and Securities 

Exchange Act Release No. 66550 (March 9, 2012), 

77 FR 15155 (March 14, 2012) (File No. SR–FICC– 

2008–01). 

7See Id. 

8See Id. 

with the Commission.1 Based on the 

Commission’s experience with 

disclosure documents, we estimate that 

the burden from compliance with Form 

1–E and the offering circular requires 

approximately 100 hours per filing. The 

annual burden hours for compliance 

with Form 1–E and the offering circular 

would be 100 hours (1 response x 100 

hours per response). Estimates of the 

burden hours are made solely for the 

purposes of the PRA, and are not 

derived from a comprehensive or even 

a representative survey or study of the 

costs of SEC rules and forms. 

Written comments are invited on: (a) 

Whether the proposed collection of 

information is necessary for the proper 

performance of the functions of the 

agency, including whether the 

information will have practical utility; 

(b) the accuracy of the agency’s estimate 

of the burden of the collection of 

information; (c) ways to enhance the 

quality, utility, and clarity of the 

information collected; and (d) ways to 

minimize the burden of the collection of 

information on respondents, including 

through the use of automated collection 

techniques or other forms of information 

technology. Consideration will be given 

to comments and suggestions submitted 

in writing within 60 days of this 

publication. 

Please direct your written comments 

to Pamela Dyson, Director/Chief 

Information Officer, Securities and 

Exchange Commission, C/O Remi 

Pavlik-Simon, 100 F Street NE., 

Washington, DC 20549; or send an email 

to: PRA_Mailbox@sec.gov. 

Dated: March 2, 2015. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–05217 Filed 3–5–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[File No. 500–1] 

In the Matter of China Infrastructure 

Investment Corp., Order of Suspension 

of Trading 

March 4, 2015. 

It appears to the Securities and 

Exchange Commission (‘‘Commission’’) 

that there is a lack of current and 

accurate information concerning the 

securities of China Infrastructure 

Investment Corp. (‘‘CIIC’’) because, 

among other things, it: (1) Has not filed 

any periodic reports since the Form 10– 

Q for the period ending September 30, 

2011, filed on November 14, 2011; and 

(2) filed a Form 8–K on December 16, 

2011, stating that the Chief Financial 

Officer (‘‘CFO’’) whose signature 

appears on Forms 10–K and 10–K/A for 

the year ending June 30, 2011, and on 

Form 10–Q for the quarter ending 

September 30, 2011, had resigned from 

CIIC on September 21, 2011, and had 

not prepared, reviewed, signed or 

authorized these filings. 

The Commission is of the opinion that 

the public interest and the protection of 

investors require a suspension of trading 

in the securities of the above-listed 

company. 

Therefore, it is ordered, pursuant to 

Section 12(k) of the Securities Exchange 

Act of 1934, that trading in the 

securities of CIIC is suspended for the 

period from 9:30 a.m. EST on March 4, 

2015, through 11:59 p.m. EDT on March 

17, 2015. 

By the Commission. 

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. 2015–05370 Filed 3–4–15; 4:15 pm] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74411; File No. SR–FICC– 

2014–09] 

Self-Regulatory Organizations; Fixed 

Income Clearing Corporation; Order 

Approving Proposed Rule Change To 

Amend the Rules of the Government 

Securities Division and the MortgageBacked Securities Division Regarding 

the Default of Fixed Income Clearing 

Corporation 

March 2, 2015. 

I. Introduction 

On November 12, 2014, the Fixed 

Income Clearing Corporation (‘‘FICC’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) proposed 

rule change SR–FICC–2014–09 pursuant 

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

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

19b–4 thereunder.2 The proposed rule 

change was published for comment in 

the Federal Register on December 2, 

2014.3 On January 9, 2015, pursuant to 

Section 19(b)(2)(A)(ii) of the Act,4 FICC 

consented to an extension of the time 

for Commission action on the proposed 

rule change to March 2, 2015. The 

Commission received no comment 

letters in response to the proposed rule 

change. For the reasons discussed 

below, the Commission is approving the 

proposed rule change. 

II. Description 

FICC filed the proposed rule change 

to amend the clearing rules of the 

Government Securities Division 

(‘‘GSD’’) and of the Mortgage-Backed 

Securities Division (‘‘MBSD’’) 

concerning a default by FICC.5 The FICC 

Default Rules were added to GSD’s and 

MBSD’s rules in 2010 and 2012, 

respectively, to make explicit the closeout netting of obligations between FICC 

and its clearing members in the event 

that FICC becomes insolvent or defaults 

on its obligations to its clearing 

members.6 FICC represented that the 

FICC Default Rules provide clarity to 

clearing member firms in their 

application of balance sheet netting to 

their positions with FICC under U.S. 

GAAP.7 FICC further represented that 

the FICC Default Rules allow clearing 

members to comply with Basel Accord 

Standards relating to netting, and 

thereby enable clearing members to 

calculate their capital requirements on 

the basis of their net credit exposure.8

The existing FICC Default Rules cover 

three general types of default: Voluntary 

proceedings defaults; involuntary 

proceedings defaults; and noninsolvency related defaults. Under the 

existing FICC Default Rules, FICC states 

that it is considered in default with 

respect to voluntary proceedings 

defaults (i) immediately upon the 

dissolution of FICC, (ii) the voluntary 

institution of proceedings by FICC 

seeking a judgment of insolvency or 

bankruptcy or other similar relief, or 

(iii) the voluntary presentation by FICC 

of a petition for its winding up or 

liquidation. 

Under the existing FICC Default 

Rules, FICC is considered in default 

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12214 Federal Register / Vol. 80, No. 44 / Friday, March 6, 2015 / Notices 

9 15 U.S.C. 78s(b)(2)(C). 

10 15 U.S.C. 78q–1(b)(3)(F). 

11 Id. 

12 15 U.S.C. 78q–1. 

13 15 U.S.C. 78s(b)(2). 

14 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). 

with respect to involuntary proceedings 

defaults on the 91st calendar day after 

the judgment of insolvency or 

bankruptcy or the entry of an order for 

relief (or similar order) for FICC’s 

winding up or liquidation, or the 

appointment of an administrator, 

provisional liquidator, conservator, 

receiver, trustee, custodian or other 

similar official for all or substantially all 

of FICC’s assets, where such judgment, 

order or appointment, as applicable, 

remains unstayed throughout the 90 

calendar day grace period. FICC is 

considered in default with respect to 

non-insolvency related defaults on the 

91st calendar day after it receives notice 

from a member of its failure to make an 

undisputed payment or delivery to such 

member that is required under the GSD 

Rules or the MBSD Rules, respectively, 

where such failure remains unremedied 

throughout the 90 calendar day grace 

period. 

The existing FICC Default Rules 

exclude the following from the scope of 

what is considered a non-insolvency 

related default: (i) The failure on the 

part of FICC to satisfy obligations to 

members in wind-down, members in 

default, or members for whom FICC has 

ceased to act pursuant to either GSD 

Rule 22A or MBSD Rule 17, as 

applicable; (ii) the satisfaction of any 

payment or delivery obligation by FICC 

through alternate means as provided in 

GSD or MBSD rules, as applicable; (iii) 

the failure of the other division of FICC 

to satisfy a payment or delivery 

obligation to a clearing member; and (iv) 

the failure to satisfy any payment or 

delivery obligation required to be made 

to a clearing member that is solely the 

result of an operational, technological, 

or administrative error or impediment, 

provided that FICC possesses sufficient 

funds or assets to satisfy the obligation. 

Additionally, according to FICC, the 

grace period can be extended beyond 90 

calendar days under the existing FICC 

Default Rules in a non-insolvency 

related default situation where a 

payment or delivery deadline has been 

suspended under GSD Rule 42 or MBSD 

Rule 33, as applicable, in which case the 

90 calendar day grace period would 

commence on the date FICC receives 

notice from a clearing member of its 

failure to make an undisputed payment 

or delivery on the later due date 

determined pursuant to the suspension. 

Pursuant to this rule change, as 

approved, FICC is now amending its 

FICC Default Rules in order to more 

closely align such rules with those of its 

peer central counterparties and to 

facilitate the participation of market 

participants, including registered 

investment companies, in FICC’s 

services by providing members with 

further legal certainty regarding their 

rights with respect to a default by FICC. 

First, FICC is amending its FICC Default 

Rules to add the voluntary making by 

FICC of a general assignment for the 

benefit of creditors as an additional type 

of voluntary proceeding. Second, FICC 

is eliminating the 90 calendar day grace 

period for involuntary proceeding 

defaults. According to FICC, this change 

will result in FICC being considered in 

default immediately upon the judgment 

of insolvency or bankruptcy or the entry 

of an order for relief (or similar order) 

for FICC’s winding-up or liquidation, or 

the appointment of a receiver, trustee or 

other similar official for FICC or 

substantially all of FICC’s assets, 

provided that such receiver, trustee or 

other similar official is appointed 

pursuant to the federal securities laws, 

particularly Section 19(i) of the Act, or 

Title II of the Dodd-Frank Wall Street 

Reform and Consumer Protection Act. 

Third, FICC is reducing the grace 

period from 90 to 7 calendar days for 

non-insolvency related defaults. 

According to FICC, this change will 

result in it being in a non-insolvency 

related default on the 8th calendar day 

after it receives notice from a member of 

its failure to make an undisputed 

payment or delivery to such member 

that is required under the rules of GSD 

or MBSD, as applicable, provided that 

such failure has not been remedied 

during the 7 calendar days, and does not 

fall within the category of exclusions 

that are enumerated in clause (b)(i), subclauses (A), (B) and (C) of the GSD 

Default Rule or the MBSD Default Rule, 

as applicable. 

Fourth, FICC is removing the 

provisions that provide for a potential 

extension of the grace period in a noninsolvency default situation where the 

deadline for a payment or delivery 

obligation of FICC has been suspended 

by FICC under either GSD Rule 42 or 

MBSD Rule 33, as applicable. As a 

result, the grace period will commence 

on the date FICC receives notice from a 

member of its failure to make an 

undisputed payment or delivery on the 

later due date determined pursuant to 

the suspension. 

Fifth, FICC is removing the provisions 

that exclude from the scope of what can 

be considered a non-insolvency related 

default the failure to satisfy any 

payment or delivery obligation required 

to be made to a clearing member that is 

the result of an operational, 

technological, or administrative error or 

impediment. 

Sixth, is adding language to the FICC 

Default Rules to clarify that no other 

provision within the rules of GSD or 

MBSD, respectively, including FICC’s 

authority under GSD Rule 42 and MBSD 

Rule 33, as applicable, can override the 

definition of what constitutes a default 

by FICC. 

III. Discussion 

Section 19(b)(2)(C) of the Act 9 directs 

the Commission to approve a selfregulatory organization’s proposed rule 

change if the Commission finds that the 

proposed rule change is consistent with 

the requirements of the Act and the 

rules and regulations thereunder 

applicable to such organization. Section 

17A(b)(3)(F) of the Act 10 requires, 

among other things, that the rules of a 

clearing agency are designed to promote 

the prompt and accurate clearance and 

settlement of securities transactions. 

After careful review, the Commission 

finds that FICC’s rule change to amend 

the FICC Default Rules is consistent 

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

because the changes as proposed in 

FICC’s filing should provide further 

legal certainty to FICC’s clearing 

members regarding their close-out 

netting rights with respect to a default 

by FICC. In addition, FICC’s rule 

changes should assist in addressing 

certain regulatory concerns of new 

market participants, including 

registered investment companies, which 

FICC believes will facilitate their 

participation in FICC’s central 

counterparty services and thus facilitate 

the prompt and accurate clearance and 

settlement of securities transactions 

submitted by such market participants. 

IV. Conclusion 

On the basis of the foregoing, the 

Commission concludes that the 

proposal is consistent with the 

requirements of the Act, particularly the 

requirements of Section 17A of the 

Act,12 and the rules and regulations 

thereunder. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,13 that the 

proposed rule change (File No. SR– 

FICC–2014–09) be and hereby is 

approved.14

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Federal Register / Vol. 80, No. 44 / Friday, March 6, 2015 / Notices 12215 

15 17 CFR 200.30–3(a)(12). 

1 12 U.S.C. 5465(e)(1)(A). The Financial Stability 

Oversight Council designated OCC a systemically 

important financial market utility on July 18, 2012. 

See Financial Stability Oversight Council 2012 

Annual Report, Appendix A, http://

www.treasury.gov/initiatives/fsoc/Documents/

2012%20Annual%20Report.pdf. Therefore, OCC is 

required to comply with the Payment, Clearing and 

Settlement Supervision Act and file advance 

notices with the Commission. 

2 17 CFR 240.19b–4(n)(1)(i). As the Commission 

noted in the notice of filing of the advance notice, 

as modified by Amendment No. 1, OCC stated that 

the purpose of this proposal is, in part, to facilitate 

compliance with proposed Commission rules and 

address Principle 15 of the Principles for Financial 

Market Infrastructures (‘‘PMFIs’’). The proposed 

Commission rules are pending. See Securities 

Exchange Act Release No. 71699 (March 12, 2014), 

79 FR 29508 (May 22, 2014) (S7–03–14). Therefore, 

the Commission has evaluated this advance notice 

under the Payment, Clearing and Settlement 

Supervision Act and the rules currently in force 

thereunder. See Securities Exchange Act Release 

No. 74202 (February 4, 2015), 80 FR 7056 (February 

9, 2015) (SR–OCC–2014–813) at note 3. 

3According to OCC, OCC filed Amendment No. 

1 to: (i) Update OCC’s plan for raising additional 

capital (‘‘Capital Plan’’) in connection with 

negotiations between OCC and the options 

exchanges that own equity in OCC (‘‘Stockholder 

Exchanges’’ or ‘‘stockholders’’) and that would 

contribute additional capital under the Capital Plan, 

(ii) correct typographical errors, and (iii) update the 

Term Sheet included as an exhibit, which 

summarizes material features of the Capital Plan. 

4Securities Exchange Act Release No. 74202 

(February 4, 2015), 80 FR 7056 (February 9, 2015) 

(SR–OCC–2014–813). In conjunction with this 

advance notice, OCC filed a corresponding 

proposed rule change seeking approval of changes 

to its By-Laws, Certificate of Incorporation and 

relevant agreements, including its Stockholders 

Agreement, necessary to implement the Capital 

Plan. This proposed rule change was published in 

the Federal Register on January 30, 2015. Securities 

Exchange Act Release No. 74136 (January 26, 2015), 

80 FR 5171 (January 30, 2015) (SR–OCC–2015–02). 

5See Letter from Eric Swanson, General Counsel 

& Secretary, BATS Global Markets, Inc., (February 

19, 2015) (‘‘BATS Letter’’); Letter from Tony 

McCormick, Chief Executive Officer, BOX Options 

Exchange, (February 19, 2015) (‘‘BOX Letter’’); 

Letter from Howard L. Kramer on behalf of 

Belvedere Trading, CTC Trading Group, IMC 

Financial Markets, Integral Derivatives, 

Susquehanna Investment Group, and Wolverine 

Trading, (February 20, 2015) (‘‘MM Letter’’); Letter 

from Ellen Greene, Managing Director, Financial 

Services Operations, SIFMA, (February 20, 2015) 

(‘‘SIFMA Letter’’); Letter from James E. Brown, 

General Counsel, OCC, (February 23, 2015) 

(responding to BATS Letter and BOX Letter) (‘‘OCC 

Letter I’’); Letter from James E. Brown, General 

Counsel, OCC, (February 23, 2015) (responding to 

MM Letter) (‘‘OCC Letter II’’); Letter from Barbara 

J. Comly, Executive Vice President, General Counsel 

& Corporate Secretary, Miami International 

Securities Exchange, LLC (February 24, 2015) 

(‘‘MIAX Letter’’); Letter from James E. Brown, 

General Counsel, OCC, (February 24, 2015) 

(responding to SIFMA Letter) (‘‘OCC Letter III’’). 

Since the proposal was filed as both an advance 

notice and proposed rule change, the Commission 

considered all comments received on the proposal, 

regardless of whether the comments were submitted 

to the proposed rule change or advance notice. In 

its assessment of the advance notice, the 

Commission assessed whether the issues raised by 

the commenters relate to the level or nature of risks 

presented to OCC by the Capital Plan. See 

comments on the advance notice (File No. SR– 

OCC–2014–813), http://www.sec.gov/comments/srocc-2014-813/occ2014813.shtml and comments on 

the proposed rule change (File No. SR–OCC–2015– 

02), http://www.sec.gov/comments/sr-occ-2015-02/

occ201502.shtml. 

6OCC filed a proposed rule change seeking 

approval of changes to its By-Laws, Certificate of 

Incorporation and relevant agreements, including 

its Stockholders Agreement, necessary to 

implement the Capital Plan. See supra note 4. 

7The Stockholder Exchanges are: Chicago Board 

Options Exchange, Incorporated; International 

Securities Exchange, LLC; NASDAQ OMX PHLX 

LLC; NYSE MKT LLC; and NYSE Arca, Inc. 

For the Commission by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–05190 Filed 3–5–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74387; File No. SR–OCC– 

2014–813] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of No Objection to Advance Notice 

Filing, as Modified by Amendment No. 

1, Concerning a Proposed Capital Plan 

for Raising Additional Capital That 

Would Support The Options Clearing 

Corporation’s Function as a 

Systemically Important Financial 

Market Utility 

February 26, 2015. 

On December 29, 2014, The Options 

Clearing Corporation (‘‘OCC’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) the 

advance notice File No. SR–OCC–2014– 

813 pursuant to Section 806(e)(1)(A) of 

the Payment, Clearing, and Settlement 

Supervision Act of 2010 (‘‘Payment, 

Clearing and Settlement Supervision 

Act’’) 1 and Rule 19b–4(n)(1)(i) under 

the Securities Exchange Act of 1934 

(‘‘Act’’).2 On January 14, 2015, OCC 

filed Amendment No. 1 to the advance 

notice.3 The advance notice was 

published for comment in the Federal 

Register on February 9, 2015.4 The 

Commission received eight comment 

letters on OCC’s proposal.5 This 

publication serves as a notice of no 

objection to proposal discussed in the 

advance notice. 

I. Description of the Advance Notice 

Pursuant to this advance notice, OCC 

is implementing a Capital Plan under 

which the Stockholder Exchanges will 

make an additional capital contribution 

and commit to replenishment capital 

(‘‘Replenishment Capital’’) in 

circumstances discussed below, and 

will receive, among other things, the 

right to receive dividends from OCC. In 

addition to the additional capital 

contribution and Replenishment 

Capital, the main features of the Capital 

Plan include: (i) A policy establishing 

OCC’s clearing fees at a level that would 

be sufficient to cover OCC’s estimated 

operating expenses plus a ‘‘business risk 

buffer’’ as described below (‘‘Fee 

Policy’’), (ii) a policy establishing the 

amount of the annual refund to clearing 

members of OCC’s fees (‘‘Refund 

Policy’’), and (iii) a policy for 

calculating the amount of dividends to 

be paid to the options exchanges 

owning equity in OCC (‘‘Dividend 

Policy’’). OCC stated that it intends to 

implement the Capital Plan on or about 

February 27, 2015, subject to all 

necessary regulatory approvals.6

OCC states in its proposal that it is 

implementing this Capital Plan, in part, 

to increase significantly OCC’s capital in 

connection with its increased 

responsibilities as a systemically 

important financial market utility. 

OCC’s proposal includes an infusion of 

substantial additional equity capital by 

the Stockholder Exchanges to be made 

prior to February 27, 2015, subject to 

regulatory approval, that when added to 

retained earnings accumulated by OCC 

in 2014 will significantly increase 

OCC’s capital levels as compared to 

historical levels. Additionally, the 

proposed change includes the 

Replenishment Capital commitment, 

which will provide OCC with access to 

additional equity contributed by the 

Stockholder Exchanges should OCC’s 

equity fall close to or below the amount 

that OCC determines to be appropriate 

to support its business and manage 

business risk. 

A. Background 

OCC is a clearing agency registered 

with the Commission and is also a 

derivatives clearing organization 

(‘‘DCO’’) regulated in its capacity as 

such by the Commodity Futures Trading 

Commission (‘‘CFTC’’). OCC is a 

Delaware business corporation and is 

owned equally by the Stockholder 

Exchanges, five national securities 

exchanges for which OCC provides 

clearing services.7 In addition, OCC 

provides clearing services for seven 

other national securities exchanges that 

trade options (‘‘Non-Stockholder 

Exchanges’’). In its capacity as a DCO, 

OCC provides clearing services to four 

futures exchanges. OCC also has been 

designated systemically important by 

the Financial Stability Oversight 

Council pursuant to the Payment, 

Clearing and Settlement Supervision 

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