Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 10881 

13 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Under OCC’s By-Laws, the Board may elect one 

or more officers as it may from time to time 

determine are required for the effective 

management and operation of the Corporation. ByLaws Art. IV § 1. In addition, the Chairman, Chief 

Executive Officer and Chief Operational Officer 

each may appoint such officers, in addition to those 

elected by the Board, and such agents as they each 

shall deem necessary or appropriate to carry out the 

functions assigned to them. By-Laws Art. IV § 2. 

purpose of the Act. In general, the 

amendments are intended to provide 

clarifications and additional details 

where necessary in order to reflect 

existing practices for CDS stress-testing 

and back-testing and are not intended to 

impose new requirements on Clearing 

Members. The terms of cleared CDS 

contracts and of clearing are not 

otherwise changing. As such, the 

amendments will apply to all CDS 

Clearing Members and are unlikely, in 

ICE Clear Europe’s view, to materially 

affect the cost of clearing for CDS 

products or affect access to clearing for 

CDS products at ICE Clear Europe or the 

market for cleared services generally. To 

the extent the changes could lead to 

changes in margin rates, based on the 

results of stress-testing and/or backtesting, ICE Clear Europe believes any 

such changes would be designed to 

appropriately reflect its credit risk from 

CDS Clearing Members with respect to 

cleared positions. Therefore, ICE Clear 

Europe does not believe the proposed 

rule changes 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 amendments have not been 

solicited or received by ICE Clear 

Europe. ICE Clear Europe will notify the 

Commission of any written comments 

received with respect to the proposed 

rule change. 

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– 

ICEEU–2022–004 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–ICEEU–2022–004. 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 Europe and on ICE 

Clear Europe’s website at https://

www.theice.com/clear-europe/ 

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–ICEEU– 

2022–004 and should be submitted on 

or before March 18, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–03960 Filed 2–24–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94283; File No. SR–OCC– 

2022–002] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing of Proposed Rule Change 

Concerning the Options Clearing 

Corporation’s Governance 

Arrangements 

February 18, 2022. 

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

Securities Exchange Act of 1934 

(‘‘Exchange Act’’ or ‘‘Act’’),1 and Rule 

19b–4 thereunder,2 notice is hereby 

given that on February 7, 2022, The 

Options Clearing Corporation (‘‘OCC’’ or 

‘‘Corporation’’) 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 primarily by OCC. 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 

This proposed rule change would 

modify and enhance OCC’s governance 

arrangements. Specifically, OCC is 

proposing to amend certain of its 

governing documents by: (i) Clarifying 

that OCC’s Public Directors may not be 

affiliated with any designated contract 

market (‘‘DCM’’) or futures commission 

merchant (‘‘FCM’’); (ii) allowing the 

Board of Directors (‘‘Board’’) to delegate 

authority to (a) Board-level committees 

(‘‘Committees’’) to review and approve 

certain routine initiatives and policies, 

as well as to authorize certain regulatory 

filings and (b) an OCC Officer to 

authorize certain regulatory filings in 

more limited cases; 3 (iii) removing the 

portion of Article XI, Section 1 of the 

By-Laws that allows OCC to deem the 

affirmative vote or consent of an 

Exchange Director to be the approval of 

the stockholder that elected the 

Exchange Director for By-Law 

amendments that require stockholder 

consent; and (iv) applying additional 

amendments recommended as part of 


lotter on DSK11XQN23PROD with NOTICES1
10882 Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 

4The filing does not propose changes to the 

Regulatory Committee Charter. 

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

OCC’s public website: https://www.theocc.com/ 

Company-Information/Documents-and-Archives/ 

By-Laws-and-Rules. 

6See By-Laws Art. III § 6A & Interpretation and 

Policy .01. 

7See Securities Exchange Act of 1934 Release 

(‘‘Exchange Act Release’’) No. 30328 (Jan. 31, 1992), 

57 FR 4784 (Feb. 7, 1992) (File No. SR–OCC–92– 

2). 

8See Exchange Act Release No. 44434 (June 15, 

2001), 66 FR 33283 (June 21, 2001) (File No. SR– 

OCC–2001–05). 

9See CPC Charter, available at https://

www.theocc.com/about/corporate-information/ 

board-charter (‘‘The Committee is authorized to 

review and approve changes in OCC’s fees, 

including authorizing the filing of regulatory 

submissions related thereto’’). 

OCC’s annual review of certain 

governance arrangements. 

Proposed amendments to the By-Laws 

can be found in Exhibit 5A to File No. 

SR–OCC–2022–002. Proposed 

amendments to the Board of Directors 

Charter and Corporate Governance 

Principles (‘‘Board Charter’’) can be 

found in Exhibit 5B to File No. SR– 

OCC–2022–002 Proposed amendments 

to OCC’s Fitness Standards for 

Directors, Clearing Members and Others 

(‘‘Fitness Standards’’), can be found in 

Exhibit 5C to File No. SR–OCC–2022– 

002. Proposed amendments to the Audit 

Committee Charter (‘‘AC Charter’’), 

Compensation and Performance 

Committee (‘‘CPC’’) Charter, Governance 

and Nominating Committee (‘‘GNC’’) 

Charter, Risk Committee Charter (‘‘RC 

Charter’’), and Technology Committee 

Charter (‘‘TC Charter’’) (collectively, 

‘‘Committee Charters’’) 4 can be found in 

Exhibits 5D to 5H to File No. SR–OCC– 

2022–002, respectively. Material 

proposed to be added to OCC’s By-Laws, 

Fitness Standards, Board Charter, and 

Committee Charters, as currently in 

effect, is marked by underlining, and 

material proposed to be deleted is 

marked with strikethrough text. 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 

This proposed rule change would 

enhance certain OCC governance 

arrangements. Specifically, OCC is 

proposing to: (i) Amend OCC’s By-Laws, 

Fitness Standards and Board Charter to 

clarify that OCC’s Public Directors may 

not be affiliated with any DCM or FCM; 

(ii) amend OCC’s By-Laws, Board 

Charter, and Committee Charters to 

enable standing delegation for (a) 

Committees to review and approve 

certain routine initiatives and policies, 

as well as to authorize certain regulatory 

filings and (b) an OCC officer to 

authorize certain regulatory filings in 

more limited cases; (iii) remove the 

portion of Article XI, Section 1 of the 

By-Laws that allows OCC to deem the 

affirmative vote or consent of an 

Exchange Director to be the approval of 

the stockholder that elected the 

Exchange Director for By-Law 

amendments that require stockholder 

consent; and (iv) implement other 

proposed changes to the Board Charter 

and Committee Charters arising from 

annual reviews of those governing 

documents. 

Public Director Qualifications 

The proposed rule change would 

amend Sections 6A and 12 of Article III 

of the By-Laws, the Fitness Standards 

adopted by the Board thereunder, and 

the Board Charter to codify OCC’s 

practice of nominating Public Directors 

who are, in addition to other 

qualifications, unaffiliated with DCMs 

and FCMs. Currently, OCC’s By-Laws 

and Fitness Standards preclude 

individuals from serving as Public 

Directors who are affiliated with a 

national securities exchange, national 

securities association, or a broker or 

dealer in securities.6 These restrictions 

were intended to broaden the mix of 

viewpoints and business expertise 

represented on the Board.7 Subsequent 

to implementing these restrictions, OCC 

added futures market clearing 

memberships and expanded its services 

to include clearance of futures and 

futures options.8 While it has been 

OCC’s practice to nominate Public 

Directors who are independent from 

DCMs and FCMs, OCC believes it is 

appropriate to codify this practice in its 

By-Laws, Fitness Standards, and Board 

Charter. OCC believes that the proposal 

to exclude DCM- or FCM-affiliated 

Public Directors would serve the same 

purpose as those restrictions related to 

national securities exchanges, securities 

associations, and brokers and dealers— 

namely, to broaden the mix of 

viewpoints and business expertise 

represented on the Board. 

Delegated Authority 

OCC proposes to amend the Board 

Charter and Committee Charters to 

delegate authority from the Board to 

Committees to review and approve 

certain routine initiatives and policies. 

In addition, OCC proposes to amend its 

By-Laws and Committee Charters to 

delegate authority to authorize certain 

regulatory filings to a Committee or, in 

limited cases, an OCC officer. However, 

as provided under the current Board 

Charter, in all instances, the Board 

would retain the obligation to oversee 

such delegated activity. 

While the Board Charter and 

Committee Charters delegate many 

reviews of routine initiatives or policies 

to Committees, each Committee often 

must recommend approval of the 

initiatives or amendments to policies to 

the Board for final approval or seek 

delegated authority to approve from the 

Board on a case-by-case basis. Currently, 

all regulatory filings are approved by the 

Board except for changes to OCC’s fees, 

for which the Board has delegated 

authority to the CPC pursuant to the 

CPC Charter,9 and individual filings that 

the Board delegates to a Committee on 

a case-by-case basis. The current 

governance process has several 

disadvantages, including mandating 

numerous matters be brought to the full 

Board for approval that otherwise would 

not occupy the time and attention of the 

Board. In addition, requiring Board 

approval makes it more difficult for 

OCC to obtain authorization to file 

regulatory submissions between 

regularly scheduled Board meetings 

absent a special Board meeting. In 

practice, the Board routinely delegates 

authority to Committees to approve 

initiatives, policy changes, and rule 

filings on a case-by-case basis when 

proposed changes are expected to be 

ready for Board-level review between 

regular Board meetings, in part because 

the Board relies on the business 

expertise of the directors appointed to 

the Committees to review and approve 

proposed changes within the scope of 

each Committee’s responsibilities. The 

proposal discussed below would create 

a framework for standing delegated 

authority to each Committee for the 

review and approval of certain 

initiatives and policies, as well as to 

approve proposed rule changes for 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 10883 

10 17 CFR 240.17Ad–22(e)(3)(i). 

11The Risk Committee Charter currently grants 

the Risk Committee authority to ‘‘authorize the 

filing of regulatory submissions pursuant to’’ the 

performance of the responsibilities and functions 

that the Board shall delegate to the Risk Committee 

from time to time. See Risk Committee Charter, 

available at https://www.theocc.com/about/ 

corporate-information/board-charter. 

12 15 U.S.C. 78q–1. 

13See Confidential Exhibit 3 to File No. SR–OCC– 

2022–002 (anticipated changes to OCC procedures 

concerning internal approvals for regulatory 

filings). 

matters within the scope of authority of 

each Committee. OCC believes that such 

delegated authority would reduce the 

number of matters that must be brought 

before the full Board and promote the 

more efficient and expeditious filing 

and implementation of proposed rule 

changes. 

With respect to Committees, the 

proposal would allow the Board to 

delegate authority to each Committee to 

review and approve certain initiatives 

and policies without the need for 

separate Board approval. Specifically, 

OCC would amend the Board Charter 

and Committee Charters to allow for 

delegated authority for the Committees 

to review and approve the following 

initiatives and policies that currently 

require Board approval: 

Committee Initiatives and policies 

Audit Committee ................... Evaluation and appointment of an external auditor. 

CPC ...................................... Review and approval of the: 

• Corporate performance report (formerly the ‘‘Corporate Plan’’); and 

• annual budget. 

GNC ..................................... Review and approval of the: 

• Director Code of Conduct 

• Related Party Transaction Policy 

• Board self-evaluation questionnaire. 

Risk Committee .................... Review and approval of: 

• Risk appetites and risk tolerances 

• changes to existing models. 

Each Committee generally would also 

have the authority to amend OCC 

policies filed with the Commission as 

rules of the clearing corporation for 

matters that are within the scope of the 

Committee’s responsibilities. With 

respect to risk management-related 

policies, OCC would amend the RC 

Charter by deleting the provisions 

requiring the committee to recommend 

changes to certain risk-related policies 

to the Board for approval—under this 

proposal, the Risk Committee would be 

delegated to authorize such regulatory 

filings. The Board would retain its 

annual review of OCC’s risk 

management policies, procedures and 

systems, as required by Rule 17Ad– 

22(e)(3)(i),10 but would delegate 

authority to approve intra-year changes 

to such policies and procedures to the 

Risk Committee. Delegated authority 

would not extend to the authorization of 

rule changes that would affect OCC 

policies for which the Board has 

determined to retain oversight. The 

Board would retain the authority to 

revoke delegated authority and limit or 

modify the scope of such delegated 

authority, either in whole or in part, by 

Board resolution. 

OCC would also amend the 

Committee Charters to include among 

each Committee’s functions and 

responsibilities the authorization of 

regulatory submissions within the scope 

of the functions and responsibilities 

delegated to the Committee.11 OCC 

would also amend Article XI, Section 2 

of the By-Laws to allow the Board to 

delegate authority to Committees to 

authorize the filing of proposed 

amendments to OCC’s Rules. Board 

approval would continue to be required 

for filings that would amend By-Laws or 

Rules that require a supermajority vote 

of the Board to amend pursuant to 

Article XI, Section 2 of the By-Laws. 

The proposed changes would also 

allow the Board to delegate authority to 

an OCC officer to make certain 

regulatory filings. Such delegated 

authority would help OCC to more 

efficiently revise its Rules and rule-filed 

policies to improve their clarity and 

ensure their consistency. Factors the 

Board would consider in delegating 

such authority to an officer include, but 

are not limited to, the responsibilities 

and expertise of the officer to whom 

authority would be delegated and any 

limitations on the scope of the delegated 

authority, including limitations to the 

subject matter, materiality of the 

changes, the regulatory approval process 

required to implement the amendments, 

and the manner in which the officer 

must notify the Board or a Committee 

about filings approved pursuant to such 

authority. These factors are identified in 

proposed amendments to the Board 

Charter. To facilitate this delegated 

authority, OCC would also amend 

Section 2 of Article XI of the By-Laws 

to allow the Board to delegate authority 

to an officer to authorize regulatory 

filings that would amend OCC’s Rules. 

OCC anticipates that when 

implemented, the Board shall delegate 

authority to the Chief Legal Officer and 

Chief Regulatory Counsel to authorize 

regulatory filings that (1) may be filed 

for immediate effectiveness pursuant to 

Section 19(b)(3) of the Securities 

Exchange Act of 1934, as amended 

(‘‘Exchange Act’’),12 and (2) proposed 

rule changes that the Chief Legal Officer 

or Chief Regulatory Counsel determines 

in his or her discretion constitute 

clarifications, corrections or minor 

changes, in each case other than filings 

that would amend OCC’s By-Laws, 

Rules that require a supermajority vote 

of the Board to amend pursuant to 

Article XI, Section 2 of the By-Laws, or 

rule-filed policies for which the Board 

has retained oversight vis-a`-vis the 

Committees. In addition, OCC 

anticipates that when implemented, the 

Board’s delegation of authority will be 

conditioned on the officers notifying the 

Board of regulatory filings approved by 

delegated authority at the next regularly 

scheduled Board meeting. OCC expects 

to implement procedures to ensure the 

Board is so notified.13 Based on the 

factors identified above, OCC believes 

that the Chief Legal Officer and Chief 

Regulatory Officer have the appropriate 

responsibility and expertise to identify 

matters suitable for delegated approval 

based on the limits imposed with 

respect to the method of filing the 

proposed changes under the Exchange 

Act and the materiality of the proposed 

changes, and that the obligation to 

report matters approved pursuant to 

such authority at the next regular Board 

meeting will provide the Board with 

appropriate notice to exercise its 

oversight function. 

By-Law Article XI 

OCC is proposing to amend Article XI 

of the By-Laws to remove the provision 


lotter on DSK11XQN23PROD with NOTICES1
10884 Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 

14See Exchange Act Release No. 43630 (Nov. 28, 

2000), 65 FR 75991 (Dec. 5, 2000) (File No. SR– 

OCC–00–05). 

15 Id. 

16For example, OCC provides thought leadership 

and education to market participants and the public 

about the prudent use of products that OCC clears. 17See By-Law Art. III § 1 (providing for nine 

Member Directors on the Board). 18See Optimizing Incentives, Resilience and 

Stability in Central Counterparty Clearing: 

Perspective on CCP Issues from a Utility Model 

Clearinghouse at 7–8, available at https://

www.theocc.com/Newsroom/Insights/2020/09-22- 

Optimizing-Incentives,-Resilience-and-Stabil. 

19Specifically, OCC is proposing to remove 

unnecessary words and phrases, or otherwise 

modify verbiage by: Under the ‘‘Mission of the 

Board’’ heading, in the tenth bulleted item 

describing the Board’s oversight role, removing 

‘‘such officer’’ from ‘‘approving the compensation 

of each such officer’’; under the ‘‘Board Issues’’ 

heading and ‘‘Membership’’ subheading: In the first 

paragraph of the ‘‘Selection of Member Directs and 

Public Directors’’ section, removing ‘‘in order’’ in 

‘‘retain a search firm in order to assist [the GNC] 

in these efforts’’; in the second paragraph of the 

same section, replacing ‘‘such annual meeting’’ 

with ‘‘the annual meeting,’’ deleting ‘‘as in effect 

from time to time’’ from ‘‘the Director Nomination 

Procedure as in effect from time to time,’’ and 

deleting the introductory clause beginning the 

sentence, ‘‘With respect to Member Directors’’; in 

the ‘‘Member Directors Changing Their 

Employment’’ paragraph of the ‘‘Retirement’’ 

section, deleting ‘‘with respect thereto’’ and 

‘‘requirements of the’’ in ‘‘the [GNC] . . . shall 

recommend to the Board any action to be taken 

with respect thereto, consistent with the 

requirements of the By-Laws concerning the 

continued eligibility of such person to remain a 

Member Director;’’ under the ‘‘Board Issues’’ 

heading and ‘‘Conduct’’ subheading, the second 

paragraph of ‘‘Distribution of Materials; Board 

Presentations’’ in the ‘‘Board Meetings’’ section, 

replacing ‘‘summaries/slides of presentations’’ with 

‘‘materials’’; and under the ‘‘Management Structure, 

Evaluation and Succession’’ heading and 

‘‘Management Structure’’ section, deleting ‘‘what is 

in’’ in the phrase ‘‘the specific needs of the business 

and what is in the best interest of OCC and the 

market participants it serves.’’ 

that allows OCC to treat an Exchange 

Director’s vote as the consent of the 

stockholder who elected the Exchange 

Director for those amendments to the 

By-Laws that require stockholder 

consent. That provision codified a longstanding understanding between OCC 

and the stockholders to consider the 

affirmative vote of each Exchange 

Director as the approval of the 

stockholder.14 To avoid potential 

conflicts between an Exchange 

Director’s fiduciary duty as a director 

and the Exchange Director’s fiduciary 

duty to the stockholder, the By-Laws 

provide that an Exchange Director may 

disclaim such stockholder consent.15 It 

is OCC’s current practice to obtain 

written consent from the stockholders 

for all matters that require such consent. 

This proposed rule change would 

eliminate the outdated authority in 

OCC’s By-Laws to impute an Exchange 

Director’s vote to constitute stockholder 

consent and better reflect current 

practice. 

Other Amendments to the Board Charter 

and Corporate Charters 

The proposed change would make 

other housekeeping amendments to the 

Board Charter and Committee Charters 

arising from the annual review of OCC’s 

governance arrangements. These 

proposed amendments are intended to 

increase consistency across OCC’s 

governance arrangements and to make 

other conforming changes to improve 

their clarity and transparency. 

Board Charter 

This proposed rule change would 

amend the Board Charter by clarifying 

that the Board has delegated to 

Committees the ‘‘oversight’’ of specific 

risks, not the ‘‘management’’ of those 

risks. This proposed change better 

aligns the Board Charter with the 

Committee Charters and better 

distinguishes responsibilities of the 

Board, Committees, and management. 

The Board Charter would also be 

amended to replace reference to ‘‘senior 

management’’ or management in 

instances where referring to OCC’s 

Management Committee would more 

clearly delineate OCC’s governance 

structure. The proposed change would 

also amend the discussion of the 

Board’s mission to more accurately 

reflect that OCC’s services to the 

industry are not limited to clearance 

and settlement.16 The amendments 

would also clarify that the Board 

approves ‘‘material,’’ rather than 

‘‘major,’’ changes in auditing and 

accounting principles and practices. 

This proposed change would align the 

Board Charter with language in the AC 

Charter. 

The proposed change would also 

amend provisions governing the 

composition of the Board and the Risk 

Committees to reflect OCC’s belief that 

strong and transparent governance with 

robust member input on relevant risk 

issues is necessary to provide effective 

risk management, consistent with OCC’s 

current practice. Proposed changes to 

the Board Charter and RC Charter would 

codify that one of the factors OCC 

considers when nominating Directors to 

the Board and Risk Committee is to 

obtain input from a broad array of 

market participants on risk management 

issues. This amendment would align the 

Board Charter and RC Charter with the 

By-Laws, which require significant 

Clearing Member representation on the 

Board.17 OCC believes this proposed 

change is consistent with the 

recommendation made by certain 

market participants that central 

counterparties like OCC have 

governance practices in place that 

obtain and address input from a broader 

array of market participants on risk 

issues.18

In addition, the proposed changes 

would amend the Board Charter to 

provide for a minimum of four meetings 

per year, rather than five. This proposed 

change would align the Board Charter 

with the Committee Charters, which 

generally require at least four meetings 

each year. The proposed changes would 

also modify the attendance guidelines to 

provide that attendance telephonically 

or by videoconference for meetings 

scheduled for in-person attendance is 

discouraged. This proposed change 

conforms with the current Director Code 

of Conduct and would be applied to 

each of the Committee Charters. 

The proposed changes would also 

revise the description of the Conflict of 

Interest Policy. Specifically, OCC would 

streamline the discussion by defining 

‘‘conflict of interest’’ to include actual, 

potential or apparent conflicts of 

interest. Accordingly, OCC would 

remove references to ‘‘potential’’ 

conflicts of interests or matters that may 

‘‘be reasonably perceived by others to 

raise questions about potential conflicts 

of interest’’ because potential or 

apparent conflicts of interest would now 

be subsumed by the defined term. These 

changes would align the Board Charter 

with the current Director Code of 

Conduct, which employs the same 

defined term. The Board Charter’s 

discussion of ethics and conflicts of 

interest would also be amended to 

reflect the full title of the Director Code 

of Conduct and the corporate title for 

OCC’s general counsel. In addition, the 

Board Charter would be updated to 

clarify that an Exchange Director’s, 

Member Director’s, or Public Director’s 

qualification as independent for 

purposes of service on the Audit 

Committee is subject to the assessment 

of the Board and GNC for other 

disqualifying material relationships, as 

provided by the current Board Charter. 

The proposed changes would also 

apply other administrative changes to 

remove unnecessary verbiage to certain 

provisions to enhance the clarity and 

concision of the Board Charter.19

AC Charter 

The Audit Committee assists the 

Board in overseeing OCC’s financial 

reporting process, OCC’s system of 

internal control, OCC’s auditing process, 

OCC’s process for monitoring 

compliance with applicable laws and 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 10885 

20See AC Charter, available at https://

www.theocc.com/about/corporate-information/ 

board-charter. 

21Specifically, OCC is proposing to remove 

unnecessary words and phrases or otherwise 

modify verbiage by: Under the ‘‘Membership and 

Organization’’ section, (i) in the first paragraph of 

the ‘‘Composition’’ section, abbreviating ‘‘Board of 

Directors’’ and removing extraneous references to 

the ‘‘full’’ Board and ‘‘full Committee membership,’’ 

and (ii) in the first paragraph of the ‘‘Meetings’’ 

section, replacing ‘‘The Committee will’’ with ‘‘The 

Committee shall’’ for consistency with the language 

of similar requirements; and under the ‘‘Functions 

and Responsibilities’’ section, in the ninth bulleted 

item concerning the Audit Committee’s functions 

and responsibilities in discharging is oversight role, 

replacing ‘‘at least once in a calendar year’’ with ‘‘at 

least once every calendar year.’’ 

22See CPC Charter, available at https://

www.theocc.com/about/corporate-information/ 

board-charter. 

23Specifically, OCC is proposing to remove 

unnecessary words, phrases or punctuation, or 

otherwise modify verbiage by: In the ‘‘Membership 

and Organization’’ section, (i) in the first paragraph 

of the ‘‘Composition’’ section, replacing ‘‘The 

Committee shall consist of’’ with ‘‘The Committee 

shall be comprised of’’; and (ii) in the first 

paragraph of the ‘‘Meetings’’ section, replacing 

‘‘The Committee will’’ with ‘‘The Committee shall’’ 

and deleting ‘‘is’’ in the phrase ‘‘as is necessary’’; 

in the ‘‘Authority’’ section and ‘‘Scope’’ subsection, 

correcting a reference to ‘‘employees of the OCC,’’ 

which should be ‘‘employees of OCC;’’ for the 

bulleted items discussing the CPC’s functions and 

responsibilities in discharging its oversight role in 

the ‘‘Functions and Responsibilities’’ section: in the 

fifth bulleted item, deleting the phrase ‘‘with 

respect thereto’’; in the eighth bulleted item 

replacing ‘‘For each calendar year’’ with ‘‘Each 

calendar year’’; and fifteenth bulleted item, 

replacing ‘‘every two years’’ with ‘‘every two 

calendar years.’’ 

24See GNC Charter, available at https://

www.theocc.com/about/corporate-information/ 

board-charter. 

regulation, and OCC’s compliance and 

legal risks.20 The proposed rule change 

would amend the discussion of the 

Audit Committee’s functions and 

responsibilities by adding the Audit 

Committee’s oversight of management’s 

responsibility to ‘‘measure’’ compliance 

and legal risks to conform with the 

Board Charter, which provides that the 

Board oversees OCC’s processes and 

frameworks for comprehensively 

managing such risks. In addition, the 

proposed changes would provide that 

the Audit Committee recommends 

material changes in accounting 

principles and practices for Board 

approval, which aligns with the 

provision in the Board Charter 

providing that the Board oversees OCC’s 

financial reporting, internal and 

external auditing, and accounting and 

compliance processes, including the 

approval of such major (i.e., material) 

changes. 

OCC is also proposing to update the 

cadence of certain Audit Committee 

reviews to reflect that the Audit 

Committee shall conduct the review 

each regular meeting. The current AC 

Charter contemplates that the Audit 

Committee shall conduct certain 

reviews quarterly based on the 

assumption that regular meetings will 

occur quarterly. While it is generally the 

case that regular meetings are scheduled 

each quarter, the proposed change 

would avoid the need to call special 

meetings to address items on a quarterly 

cadence if a regularly scheduled 

meeting happens to fall at the beginning 

of the next quarter or the end of the last 

quarter. The cadence of reviews for 

other certain reports described as 

‘‘periodic’’ or occurring ‘‘regularly’’ 

would also be amended to reflect that 

that the review is conducted at each 

regular meeting of the Audit Committee. 

Similar changes would be made to the 

CPC Charter and TC Charter. 

OCC is also proposing certain 

administrative edits to the AC Charter. 

Reference to the Audit Committee’s 

review of the ‘‘Compliance Policy’’ 

would be changed to the ‘‘Compliance 

Risk Policy’’ to align with the current 

title of that policy. The proposed change 

would also modify reference to the 

General Counsel to reflect that the 

General Counsel is OCC’s Chief Legal 

Officer. In addition, the proposed 

change would clarify that in the section 

addressing competencies of Audit 

Committee members, ‘‘working 

familiarity with basic finance and 

accounting practices’’ means ‘‘financial 

literacy.’’ The proposed changes would 

also remove unnecessary verbiage or 

otherwise modify the verbiage in certain 

provisions to enhance the clarity, 

concision and consistency of the AC 

Charter with other Committee 

Charters.21

CPC Charter 

The Board established the CPC to 

assist the Board in overseeing general 

business, regulatory capital, investment, 

corporate planning, and compensation 

and human capital risks, as well as 

executive management succession 

planning and performance 

assessment.22 Consistent with the 

proposed change to the AC Charter, this 

proposed rule change would amend the 

CPC Charter by adding the CPC’s 

oversight of management’s 

responsibility to ‘‘measure’’ general 

business risks, including as they relate 

to OCC’s corporate performance report 

(formerly the ‘‘Corporate Plan’’) and 

corporate budget, capital requirements, 

human capital, compensation and 

benefit programs, management 

succession planning and management 

performance assessment processes, 

arising from OCC’s business activities in 

light of OCC’s role as a systemically 

important financial market utility, to 

conform with similar language in the 

Board Charter. With respect to oversight 

of OCC’s human resources programs, the 

proposed changes would amend the 

CPC Charter to reflect the CPC’s 

oversight of OCC’s diversity, equity and 

inclusion efforts. OCC believes this 

change reflects OCC’s commitment to 

recruit, retain and develop high 

performing, talented and engaged 

colleagues with diverse backgrounds 

and perspectives, to nurture an 

environment where colleagues with 

varied backgrounds feel included and 

valued, and to encourage diversity of 

thought, experiences, and perspectives 

to develop innovative solutions. 

OCC is also proposing certain 

administrative edits to the CPC Charter. 

Specifically, OCC would amend the CPC 

Charter by removing gendered pronouns 

that assume the Chairman and Chief 

Executive Officer necessarily will be 

individuals who identify as male. 

Similar changes would be applied to the 

Board Charter and AC Charter. The 

proposed changes would also provide 

for CPC oversight of OCC’s succession 

planning for ‘‘critical roles,’’ in 

alignment with terminology in OCC’s 

policies and procedures that address 

succession planning. In addition, 

references to the ‘‘Corporate Plan’’ 

would be replaced with references to 

the ‘‘corporate performance report,’’ 

which better describes the initiative by 

which the CPC assesses OCC’s 

performance against its corporate goals. 

The proposed changes would also 

include administrative changes by 

removing unnecessary verbiage or 

otherwise modifying the verbiage in 

certain provisions to enhance the clarity 

and concision, and consistency of the 

CPC Charter with other Committee 

Charters.23

GNC Charter 

The Board established the GNC to 

assist the Board in overseeing OCC’s 

corporate governance processes, 

including assessing the clarity and 

transparency of OCC’s governance 

arrangements, establishing the 

qualifications necessary for Board 

service to ensure that the Board is able 

to discharge its duties and 

responsibilities, identifying and 

recommending to the Board candidates 

eligible for service as Public Directors 

and Member Directors, and resolving 

certain conflicts of interests.24 The 

proposed changes to the GNC Charter 

would clarify the Board’s expectation 

that the GNC assist the Board in 


lotter on DSK11XQN23PROD with NOTICES1
10886 Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 

25Specifically, OCC is proposing to remove 

unnecessary words and phrases, or otherwise 

modify verbiage by: Under the ‘‘Membership and 

Organization’’ section, in the first paragraph of the 

‘‘Composition’’ section, (i) replacing ‘‘The 

Committee will be composed’’ with ‘‘The 

Committee shall be comprised,’’ (ii) inserting ‘‘at 

least’’ before the required number of Exchange 

Director and Member Director membership on the 

GNC, and (iii) replacing ‘‘The Committee Chair will 

be designated by the Board from among the Public 

Director Committee members’’ with ‘‘The Chair 

shall be a Public Director’’; and for the bulleted 

items discussing the GNC’s functions and 

responsibilities in discharging its oversight role in 

the ‘‘Functions and Responsibilities’’ section: in the 

eleventh bulleted item, replacing ‘‘For each 

calendar year’’ with ‘‘Each calendar year’’; and in 

the thirteenth bulleted item, replacing ‘‘the manner 

in which’’ with ‘‘how.’’ 

26See RC Charter, available at https://

www.theocc.com/about/corporate-information/ 

board-charter. 

27See TC Charter, available at https://

www.theocc.com/about/corporate-information/ 

board-charter. 

28Specifically, OCC is proposing to remove 

unnecessary words and phrases, or otherwise 

modify verbiage by replacing ‘‘The Committee will’’ 

with ‘‘The Committee shall,’’ and deleting ‘‘is’’ in 

the phrase ‘‘as is necessary’’ in the first paragraph 

of the ‘‘Meetings’’ subsection of the ‘‘Membership 

and Organization’’ section. 

29 15 U.S.C. 78q–1. 

30 15 U.S.C. 78q–1(b)(3)(F). 31 17 CFR 240.17Ad–22(e)(2). 

32 15 U.S.C. 78q–1(b)(3)(F). 

33See SEC, Diversity and Inclusion Strategic Plan: 

Fiscal Years 2020–2022, available at https://

www.sec.gov/files/2020_Diversity_and_Inclusion_

Strategic_Plan.pdf. 

reviewing and proposing changes to the 

Board Charter. 

The proposed changes would also 

include administrative changes by 

removing unnecessary verbiage or 

otherwise modifying the verbiage in 

certain provisions to enhance the 

clarity, concision, and consistency of 

the GNC Charter with other Committee 

Charters.25

RC Charter 

The Board established the Risk 

Committee to assist the Board in 

overseeing OCC’s financial, collateral, 

risk model and third-party risk 

management processes, among other 

responsibilities.26 Consistent with the 

foregoing Committee Charter changes, 

this proposed rule change would amend 

the RC Charter by adding the 

committee’s oversight of management’s 

responsibility to ‘‘measure’’ these risks 

arising from OCC’s business activities in 

light of OCC’s role as a systemically 

important financial market utility, 

which conforms with similar language 

in the Board Charter. The proposed rule 

change would also change the minimum 

number of meetings from six to four to 

align with the other Committee charters 

that require a minimum of four meetings 

each year. In addition, the proposed rule 

change would consolidate discussion of 

the Risk Committee’s functions and 

responsibilities with respect to oversight 

and annual review of OCC’s 

management of liquidity risks and the 

adequacy of OCC’s committed liquidity 

facilities. This change would streamline 

the RC Charter’s discussion of liquidity 

risks. OCC would also amend the RC 

Charter to provide that the Risk 

Committee shall review and have the 

authority to approve at least once every 

twelve months OCC’s risk appetites and 

risk tolerances, consistent with the 

Board’s delegation of authority for such 

routine reviews and approvals, 

discussed above. 

OCC also proposes certain 

administrative changes to the RC 

Charter, including (i) to specify that the 

Risk Committee recommends changes to 

OCC’s Recovery and Orderly WindDown Plan ‘‘for approval,’’ consistent 

with language used with respect to 

policies for which the Board has 

retained oversight with respect to 

amendments; and (ii) to replace 

‘‘examinations’’ with ‘‘audits’’ in the 

description of the Risk Committee’s 

oversight of internal or external audits 

of OCC’s financial, collateral, risk model 

and third party risk management 

processes, consistent with the use of the 

term ‘‘audit’’ elsewhere in that 

description. 

TC Charter 

The Board established the Technology 

Committee to assist the Board in 

overseeing OCC’s information 

technology (‘‘IT’’) strategy and other 

company-wide operational 

capabilities.27 Consistent with the 

foregoing Committee Charter changes, 

this proposed rule change would amend 

the TC Charter by adding the 

Technology Committee’s oversight of 

management’s responsibility to 

‘‘measure’’ IT and other operational 

risks arising from OCC’s business 

activities in light of OCC’s role as a 

systemically important financial market 

utility to conform with similar language 

in the Board Charter. The proposed rule 

change would also amend the TC 

Charter to reflect the Technology 

Committee’s current practice of 

overseeing all security risks, not just 

information security risks. The 

proposed changes would also include 

administrative changes by removing 

unnecessary verbiage or otherwise 

modify the verbiage in certain 

provisions to enhance the clarity and 

concision of the TC Charter.28

(2) Statutory Basis 

OCC believes that the proposed rule 

change is consistent with Section 17A of 

the Exchange Act,29 and the rules 

thereunder applicable to OCC. 

Specifically, Section 17A(b)(3)(F) of the 

Exchange Act requires, among other 

things, that OCC’s rules be designed to 

promote the prompt and accurate 

clearance and settlement of securities 

and derivatives transactions and protect 

investors and the public interest.30 In 

turn, Rule 17Ad–22(e)(2) under the 

Exchange Act 31 requires that OCC 

establish, implement, maintain and 

enforce written policies and procedures 

reasonably designed to provide for 

governance arrangements that, among 

other things, are clear and transparent, 

clearly prioritize safety and efficiency, 

support the public interest and the 

objectives of owners and participants, 

specify clear and direct lines of 

responsibility, and consider the 

interests of other relevant stakeholders. 

OCC believes the proposed changes 

discussed above are consistent with 

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

Act and Rule 17Ad–22(e)(2) for the 

reasons discussed below. 

Public Director Qualifications 

OCC believes the proposed changes to 

codify OCC’s practice of nominating 

Public Directors who are unaffiliated 

with DCMs and FCMs are consistent 

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

Exchange Act.32 Excluding persons 

affiliated with a DCM or FCM from 

servicing as Public Directors would 

serve the same purpose as the current 

limitations for persons affiliated with 

national securities exchanges, securities 

associations, and brokers and dealers— 

namely, to broaden the mix of 

viewpoints and business expertise 

represented on the Board. As the 

Commission has recognized, diversity 

within organizations confers many 

benefits, including to improve decisionmaking and innovation.33 As the 

governing body responsible for the 

oversight of OCC’s activities, such 

benefits of diversity would aid the 

Board in exercising its oversight of 

OCC’s clearance and settlement 

functions to ensure that they are prompt 

and accurate and that they are 

structured to protect investors and 

promote the public interest. Amending 

OCC’s governance arrangements to 

reflect OCC’s current practice also 

provides better clarity and transparency 

for the general public into OCC’s 

governance arrangements, thereby 

promoting the public interest. 

Accordingly, the proposed change is 

designed, in general, to promote the 

prompt and accurate clearance and 

settlement of securities transactions and 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 10887 

34 15 U.S.C. 78q–1(b)(3)(F). 

35 17 CFR 240.17Ad–22(e)(2)(i), (vi). 

36Exchange Act Release No. 93102 (Sept. 22, 

2021), 86 FR 53718, 53722 (Sept. 28, 2021) (SR– 

OCC–2021–007). 

37 Id. 

38 15 U.S.C. 78q–1(b)(3)(F). 

39See Exchange Act Release No. 84458 (Oct. 19, 

2018), 83 FR 53925 (Oct. 25, 2018) (File Nos. SR– 

DTC–2018–09; SR–FICC–2018–010; SR–NSCC– 

2018–009) (implementing a similar framework for 

rule filings by delegated authority for the 

Depository Trust Company, the Fixed Income 

Clearing Corporation, and the National Securities 

Clearing Corporation). 

40 17 CFR 240.17Ad–22(e)(2). 

41See Form 19b–4 at ‘‘Procedures of the SelfRegulatory Organization,’’ available at https://

www.sec.gov/files/form19b-4.pdf. 

42 Id. 

43 15 U.S.C. 78q–1(b)(3)(F). 

44 Id. 

45 17 CFR 240.17Ad–22(e)(2). 

46 Id. 

protect investors and the public interest 

in accordance with Section 17A(b)(3)(F) 

of the Exchange Act.34

In addition, OCC believes that 

proposed changes to Article III, Section 

6A are consistent with Rule 17Ad– 

22(e)(2)(i) and (vi).35 The Commission 

has stated that while there may be 

several ways to comply with Rule 

17Ad–22(e)(2), a covered clearing 

agency governance arrangements 

generally should consider ‘‘whether the 

major decisions of the covered clearing 

agency reflect appropriately the 

legitimate interests of its direct and 

indirect participants and other relevant 

stakeholders.’’ 36 Promoting diversity of 

viewpoints among OCC’s Public 

Directors outside those already 

represented on the Board through 

Exchange and Member Directors helps 

to ensure that the Board’s decisions 

consider the interests of OCC’s direct 

and indirect participants. Codifying 

OCC’s current practice into its 

governance arrangements also help 

ensure that OCC’s governance 

arrangements are clear and transparent. 

Accordingly, the proposed changes are 

reasonably designed to be clear and 

transparent, support the public interest, 

and consider the interests of relevant 

stakeholders, in accordance with Rule 

17Ad–22(e)(2)(i) and (vi).37

Delegated Authority 

OCC believes the proposed changes to 

establish a framework for delegated 

authority are consistent with Section 

17A(b)(3)(F) of the Exchange Act.38

OCC’s rules are the foundation for 

OCC’s clearance and settlement 

activities and, per the Exchange Act, 

must be designed to ensure the prompt 

and accurate clearance and settlement of 

securities transactions and protect the 

public interest. Establishing a clear and 

transparent framework for the efficient 

delegation of authority from the Board 

to Committees and officers to approve 

changes to those rules would facilitate 

their maintenance and administration, 

helping to ensure that such rules are 

capable of facilitating the prompt and 

accurate clearance and settlement of 

securities transactions and removing 

potential impediments thereto. In 

addition, other clearing agencies have 

implemented similar delegated 

authority frameworks.39 Accordingly, 

OCC believes the proposed change is 

designed, in general, to promote the 

prompt and accurate clearance and 

settlement of securities transactions and 

protect the public interest. 

In addition, OCC believes the 

proposed changes to facilitate delegated 

authority are consistent with Rule 

17Ad–22(e)(2).40 Delegated authority 

would reduce the number of matters 

that must be brought before the full 

Board and promote the more efficient 

and expeditious filing and 

implementation of proposed rule 

changes. With respect to Committees, 

authority to review and approve certain 

initiatives and policies, or direct certain 

regulatory filings, would reside with the 

applicable Committee that has oversight 

authority over the subject matter for 

which the initiatives, policies and 

proposed changes are associated. OCC 

believes standing delegated authority to 

Committees allows for the more efficient 

operation of OCC for matters that the 

Board routinely delegates to Committees 

on a case-by-case basis. With respect to 

authority delegated to OCC officers, the 

proposed change would allow the more 

efficient and expeditious filing of rule 

filings by authorizing changes to OCC’s 

Rules or rule-filed policies, as the Board 

may from time to time delegate such 

authority to such officers. In addition, 

amending OCC’s governance 

arrangements to facilitate this delegation 

framework would promote the clarity 

and transparency of OCC’s governance 

arrangements and ensure that lines of 

responsibility remain clear and direct, 

including by amending OCC’s By-Laws 

to allow the Board from time to time to 

delegate authority to Committees or 

officers to modify OCC’s Rules, 

amending the Board Charter Committee 

Charters to identify the matters 

delegated to Committees, and amending 

the Board Charter to articulating the 

factors the Board would consider in 

delegating authority to an officer. The 

specific authority employed for a 

particular rule change would be made 

apparent in OCC’s regulatory filings, 

which describe how OCC has completed 

the required actions under its 

governance arrangements with respect 

to the filing.41 Accordingly, OCC 

believes that these proposed changes are 

reasonably designed to provide for 

governance arrangements that are clear 

and transparent, prioritize safety and 

efficiency, and specify clear and direct 

lines of responsibility, in accordance 

with Rule 17Ad–22(e)(2).42

Amendment to By-Law Article XI 

OCC believes the proposed change to 

Article XI of OCC’s By-Laws is 

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

the Exchange Act.43 Article XI governs 

amendments to OCC’s By-Laws and 

Rules designed to, among other things, 

promote the prompt and accurate 

clearance and settlement of securities 

transactions and, in general, protect 

investors and the public interest. The 

proposed amendment will improve the 

clarity and transparency of the process 

for amending OCC’s By-Laws and Rules 

by reflecting OCC’s current practice of 

obtaining written stockholder consents 

for all By-Law amendments that require 

them, rather than treating an Exchange 

Director’s vote as consent of the 

stockholder who elected the Exchange 

Director. OCC believes improving the 

clarity and transparency of the process 

for amending its By-Laws and Rules, 

which are central to OCC’s clearance 

and settlement activities, will, in turn, 

promote the accurate clearance and 

settlement of securities transactions 

and, in general, to protect investors and 

the public interest in accordance with 

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

Act.44

In addition, OCC believes the 

proposed change to Article XI is 

consistent with Rule 17Ad–22(e)(2).45

By conforming the By-Laws to reflect 

current practice, the proposed change 

would promote the clarity and 

transparency of OCC’s governance 

arrangements and ensure that OCC’s 

lines of responsibility, vis-a`-vis its 

stockholders, are clear and direct. 

Accordingly, OCC believes that these 

proposed changes are reasonably 

designed to provide for governance 

arrangements that are clear and 

transparent, and specify clear and direct 

lines of responsibility, in accordance 

with Rule 17Ad–22(e)(2).46

Other Amendments to the Board Charter 

and Committee Charters 

OCC believes the proposed changes to 

the Board Charter and Committee 

Charters to apply recommendations 

made as part of OCC’s annual review of 

those governance arrangements are 

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


lotter on DSK11XQN23PROD with NOTICES1
10888 Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 

47 15 U.S.C. 78q–1(b)(3)(F). 

48 Id. 

49 17 CFR 240.17Ad–22(e)(2). 

50 17 CFR 240.17Ad–22(e)(2)(i). 

51 Id. 

52 17 CFR 240.17Ad–22(e)(2)(iii), (vi). 

53 17 CFR 240.17Ad–22(e)(2)(v). 

54 17 CFR 240.17Ad–22(e)(2)(i), (v). 

55 17 CFR 240.17Ad–22(e)(2)(i). 

56 17 CFR 240.17Ad–22(e)(2)(i), (v). 

57 17 CFR 240.17Ad–22(e)(2)(v). 

58 17 CFR 240.17Ad–22(e)(2)(iii), (iv). 

59 17 CFR 240.17Ad–22(e)(2)(i). 

60 17 CFR 240.17Ad–22(e)(2)(v). 

61 Id. 

62 Id. 

63 17 CFR 240.17Ad–22(e)(2)(i). 

the Exchange Act.47 The Board Charter 

and Committee Charters are governance 

arrangements that are designed to 

promote the prompt and accurate 

clearance and settlement of securities 

transactions and, in general, protect 

investors and the public interest by 

governing the Board and Committee’s 

oversight of OCC’s provision of 

clearance and settlement services. 

Updating the charters to reflect the 

Board’s determination as to how the 

Board, Committees and OCC’s 

management should interact will 

enhance the effectiveness of the Board 

and Committee’s oversight of OCC’s 

clearance and settlement services. 

Accordingly, OCC believes the proposed 

changes are designed promote the 

accurate clearance and settlement of 

securities transactions and, in general, 

to protect investors and the public 

interest in accordance with Section 

17A(b)(3)(F) of the Exchange Act.48

In addition, for the reasons described 

below, OCC believes these proposed 

amendments increase consistency, 

accuracy, and transparency across these 

documents, consistent Rule 17Ad– 

22(e)(2); 49

• Amendments to the Board Charter 

would better align the Board Charter 

with the Committee Charters and better 

distinguish responsibilities of the Board, 

Committees, and management by 

clarifying that the Board has delegated 

to Committees the ‘‘oversight’’ of 

specific risks, not the ‘‘management’’ of 

those risks, consistent with Rule 17Ad– 

22(e)(2), which requires, in part, that 

OCC’s governance arrangements specify 

clear and direct lines of responsibility.50

• Further amendments to the Board 

Charter would replace references to 

‘‘senior management’’ or ‘‘management’’ 

in instances where a reference to OCC’s 

Management Committee would more 

clearly delineate OCC’s governance 

structure, consistent with Rule 17Ad– 

22(e)(2), which requires, in part, that 

OCC’s governance arrangements specify 

clear and direct lines of responsibility.51

• Further amendments to the Board 

Charter and RC Charter would codify 

that one of the factors OCC considers 

when nominating Directors to the Board 

and Risk Committee is to obtain input 

from a broad array of market 

participants, consistent with Rule 

17Ad–22(e)(2), which requires, in part, 

that OCC’s governance arrangements 

support the objectives of participants 

and consider the interests of other 

relevant stakeholders.52

• Further amendments to the Board 

Charter and Committee Charters would 

align with the current Director Code of 

Conduct by (1) modifying the 

attendance guidelines to provide that 

attendance telephonically or by 

videoconference for meetings scheduled 

for in-person attendance is discouraged 

and (2) in the case of the Board Charter, 

revising the description of the Conflict 

of Interest Policy, consistent with Rule 

17Ad–22(e)(2), which requires, in part, 

that OCC’s governance arrangements be 

clear and transparent.53

• Amendments to the AC Charter, 

CPC Charter, RC Charter, and TC 

Charter to align with language in the 

Board Charter would clarify each 

Committee’s oversight of management’s 

responsibility to ‘‘measure’’ the risks 

within the scope of those risks that the 

Board has charged each Committee to 

assist the Board in overseeing, 

consistent with Rule 17Ad–22(e)(2), 

which requires, in part, that OCC’s 

governance arrangements be clear and 

transparent and specify clear and direct 

lines of responsibility.54

• Amendments to the Board Charter 

and RC Charter would align with other 

Committee Charters in providing for a 

minimum of four meetings per year, 

consistent with Rule 17Ad–22(e)(2), 

which requires, in part, that OCC’s 

governance arrangements be clear and 

transparent.55

• Amendments to the AC Charter, 

CPC Charter, and TC Charter would 

align the cadence of certain reviews by 

and reports to those committees with 

each regularly scheduled meeting, 

regardless of whether regularly 

scheduled meetings occur within each 

fiscal quarter, consistent with Rule 

17Ad–22(e)(2), which requires, in part, 

that OCC’s governance arrangements be 

clear and transparent and specify clear 

and direct lines of responsibility.56

• Amendments to the AC Charter to 

clarify that the Audit Committee 

recommends such material changes for 

Board approval would better delineate 

the responsibilities between the Board 

and AC Charter, consistent with Rule 

17Ad–22(e)(2), which requires, in part, 

that OCC’s governance arrangements 

specify clear and direct lines of 

responsibility.57

• Amendments to the CPC Charter 

would include the CPC’s oversight of 

OCC’s diversity, equity and inclusion 

efforts, reflecting OCC’s commitment to 

a diverse and inclusive workplace, 

consistent with Rule 17Ad–22(e)(2), 

which requires, in part, that OCC’s 

governance arrangements support the 

public interest requirements of the 

Exchange Act and establish that the 

board of directors and senior 

management have appropriate 

experience and skills to discharge their 

duties and responsibilities.58

• Further amendments to the CPC 

Charter would remove gendered 

pronouns to help ensure the accuracy of 

the CPC Charter regardless of the gender 

identity of its senior management or 

directors, consistent with Rule 17Ad– 

22(e)(2), which requires, in part, that 

OCC’s governance arrangements be clear 

and transparent.59

• Amendments to the GNC Charter 

would delineate responsibilities 

between the Board and GNC by 

providing that in addition to 

recommending changes to the 

Committee Charters, as currently 

provided, the GNC shall also 

recommend changes to the Board 

Charter, as appropriate, consistent with 

Rule 17Ad–22(e)(2), which requires, in 

part, that OCC’s governance 

arrangements specify clear and direct 

lines of responsibility.60

• Amendments to the TC Charter 

would reflect that the Technology 

Committee is responsible for overseeing 

all security risks, consistent with Rule 

17Ad–22(e)(2), which requires, in part, 

that OCC’s governance arrangements 

specify clear and direct lines of 

responsibility.61

• Amendments to the RC Charter 

would reflect the Board’s delegation to 

the Risk Committee to review and have 

the authority to approve at least once 

every twelve months OCC’s risk 

appetites and risk tolerances, consistent 

with Rule 17Ad–22(e)(2), which 

requires, in part, that OCC’s governance 

arrangements specify clear and direct 

lines of responsibility.62

• Other administrative amendments 

to the Board Charter and Committee 

Charters would help ensure the 

continued clarity and transparency of 

these governing documents and employ 

consistent language across the Board 

Charter and Committee Charters, 

consistent with Rule 17Ad–22(e)(2).63


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 87, No. 38 / Friday, February 25, 2022 / Notices 10889 

64 15 U.S.C. 78q–1(b)(3)(I). 65 17 CFR 200.30–3(a)(12). 

(B) Clearing Agency’s Statement on 

Burden on Competition 

OCC does not believe that the 

proposed rule change would have any 

impact or impose any burden on 

competition.64 The proposed 

modifications to OCC’s governance 

arrangements would not unfairly inhibit 

access to OCC’s services or disadvantage 

or favor any particular user in 

relationship to another user because 

they relate to the governance structure 

of OCC, which affects all users, and do 

not relate directly to any particular 

service or particular use of OCC’s 

facilities. Accordingly, OCC does not 

believe that these proposed changes 

would have any impact between or 

among clearing agencies, Clearing 

Members, or other market participants. 

For the foregoing reasons, OCC 

believes that the proposed rule change 

is in the public interest, would be 

consistent with the requirements of the 

Exchange Act applicable to clearing 

agencies, and would not have any 

impact or impose a burden on 

competition. 

(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 

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. 

OCC shall post notice on its website 

of proposed changes that are 

implemented. The proposal shall not 

take effect until all regulatory actions 

required with respect to the proposal are 

completed. 

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–2022–002 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Vanessa Countryman, Secretary, 

Securities and Exchange Commission, 

100 F Street NE, Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–OCC–2022–002. 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/CompanyInformation/Documents-and-Archives/ 

By-Laws-and-Rules. 

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–2022–002 and should 

be submitted on or before March 18, 

2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.65

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–03962 Filed 2–24–22; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #17352 and #17353; 

KANSAS Disaster Number KS–00149] 

Presidential Declaration of a Major 

Disaster for Public Assistance Only for 

the State of Kansas 

AGENCY: Small Business Administration. 

ACTION: Notice. 

SUMMARY: This is a Notice of the 

Presidential declaration of a major 

disaster for Public Assistance Only for 

the State of Kansas (FEMA–4640–DR), 

dated 02/17/2022. 

Incident: Severe Storms and Straightline Winds. 

Incident Period: 12/15/2021. 

DATES: Issued on 02/17/2022. 

Physical Loan Application Deadline 

Date: 04/18/2022. 

Economic Injury (EIDL) Loan 

Application Deadline Date: 11/17/2022. 

ADDRESSES: Submit completed loan 

applications to: U.S. Small Business 

Administration, Processing and 

Disbursement Center, 14925 Kingsport 

Road, Fort Worth, TX 76155. 

FOR FURTHER INFORMATION CONTACT: 

Alan Escobar, Office of Disaster 

Assistance, U.S. Small Business 

Administration, 409 3rd Street SW, 

Suite 6050, Washington, DC 20416, 

(202) 205–6734. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given that as a result of the 

President’s major disaster declaration on 

02/17/2022, Private Non-Profit 

organizations that provide essential 

services of a governmental nature may 

file disaster loan applications at the 

address listed above or other locally 

announced locations. 

The following areas have been 

determined to be adversely affected by 

the disaster: 

Primary Counties: Barton, Brown, Clay, 

Cloud, Doniphan, Edwards, Ellis, 

Ellsworth, Ford, Geary, Gove, 

Graham, Grant, Gray, Greeley, 

Hamilton, Haskell, Hodgeman, 

Jewell, Kearny, Lane, Lincoln, 

Logan, Marshall, Meade, Mitchell, 

Morris, Morton, Nemaha, Ness, 

Osborne, Ottawa, Pawnee, 

Republic, Rice, Riley, Rooks, Rush, 

Russell, Saline, Scott, Sheridan, 

Smith, Stafford, Stanton, Stevens, 


lotter on DSK11XQN23PROD with NOTICES1